Terminal or curable?

A court rules part of Barack Obama’s health reform unconstitutional

“THIS lawsuit is not about health care, it's about liberty.” So crowed Ken Cuccinelli, Virginia's attorney-general, this week after winning a favourable ruling in federal court. He had brought a lawsuit arguing that part of the administration's new health law, an “individual mandate” requiring everyone to have health insurance, is unconstitutional. He also argued that all of Obamacare must be struck down.

In his ruling the judge, Henry Hudson, gave conservatives only half a loaf. He did indeed find the mandate unconstitutional. According to the court, “all seems to distil to the single question of whether or not Congress has the power to regulate—and tax—a citizen's decision not to participate in interstate commerce.” In the past, the courts have allowed the federal government to tax and otherwise regulate activities that happen within states if they affect interstate commerce.

The judge rejected the Obama administration's argument that since virtually everyone must eventually make use of health care, and hospitals are required to treat all in need of emergency care, the uninsured impose costs on the entire health system. He dismissed the notion that the federal government could prohibit citizen “inactivity”—such as not buying insurance. But he refused to strike down the new law in its entirety or to order that it should not be implemented pending appeal.

That, supporters of the health law insist, means the show will go on. The individual mandate was not supposed to come into effect until 2014 in any case, they argue, by which time this judgment may well have been overturned. Meanwhile, they intend to forge ahead with new health-insurance exchanges, curbs on bad behaviour by insurers and other provisions of the new law. They hope this will give the reforms an air of inevitability.

In fact, a mood of uncertainty seems more likely. For one thing, of the two dozen or so cases pending against Obamacare, this is the first to go against the administration. (Two earlier cases, ruled on by liberal judges in Virginia and Michigan, went in favour of the law.) Later this week a federal judge in Florida is expected to hear arguments in the most important such case, a joint action involving 20 states; like Mr Hudson, he is a conservative. It seems very likely that the Supreme Court will have to decide the matter, and that could take two years or more. This ruling, and any similar ones to come, may also provide useful ammunition for Republicans in Congress to carry out their plan to obstruct the implementation of the law by cutting funding, using procedural manoeuvres and so on.

Could this effort to kill the individual mandate ultimately kill Obamacare altogether? Perhaps, but there are two alternative possibilities that conservatives will not like. If the individual mandate is ultimately struck down but the rest of the health-reform law is ruled legal, the result will be an unsustainable system. Americans would have been promised universal coverage and insurers would have been forced to accept everyone regardless of their state of health—but free riders could easily avoid paying into the system until they fell sick. That will either bankrupt insurers or lead to huge rises in premiums.

In that case, say reformers, Congress could put in place a mix of carrots and sticks that nudges people towards getting health insurance without an explicit mandate. For example, one proposal would cut off access to insurance subsidies for a few years for those who refuse to buy coverage. If Congress fixed the law by creating an individual mandate through the back door, it could save Obamacare.

But if Republicans block such efforts, as seems likely, then America's great attempt to achieve universal coverage through regulated private markets will eventually collapse. Then the only way to satisfy tens of millions of voters who are guaranteed health insurance, argue some, would be for the government itself to provide coverage for everyone. That would not be unconstitutional, but it would certainly not be the outcome desired by today's conservative warriors.